The United States Securities and Exchange Commission (SEC) continues to delve deeper into the operations of Binance.US. Amid a growing number of allegations, the SEC is closely investigating the possibility that Binance.US, similar to FTX, may not be publicly accessible to customer assets. This suspicion has been gaining traction since a report surfaced on November 27.

A Closer Look: The SEC’s Legal Battle with Binance.US

In June, the SEC took significant legal action against Binance and its US counterpart, Binance.US, alleging that the exchange engaged in unregistered securities sales. The charges went further, implicating Binance founder Changpeng Zhao in a complex web of deception involving fraudulent activities, conflicts of interest, and blatant disregard for legal compliance.

One focus of the allegations is the alleged diversion of customer assets. Funds from Binance.US were allegedly arbitrarily transferred to Sigma Chain, a Swiss entity controlled by Zhao. The move raised questions about the exchange’s ethical practices in handling customer funds.

During a hearing on Nov. 27, Binance.US’s legal team argued that the SEC lacked any concrete evidence of misuse of assets. They urged U.S. Magistrate Judge Zia Faruqui to consider halting the SEC’s investigation, citing a lack of tangible evidence of fraud.

Matthew Laroche, a representative of Binance.US, highlighted the financial losses caused by the lawsuit. Since the SEC initiated legal action, Binance.US has seen a 90% drop in assets and a significant reduction in its user base.

CZ's confession and its implications

Curiously, Binance and Zhao agreed to plead guilty to violating U.S. anti-money laundering laws. The agreement resulted in a massive $4.3 billion settlement with the U.S. Department of Justice, the Treasury Department, and the Commodity Futures Trading Commission.

Notably, however, the guilty plea does not include the fraud-related charges brought by the SEC in its June lawsuit. Judge Farooqui, who presided over the Binance-SEC case, observed that the guilty plea reduced the likelihood that Binance.US and Zhao misappropriated customer funds.

Judge Faruqui urged Binance.US and the SEC to work toward a resolution of the dispute, setting a deadline of Dec. 15 for an update. This push for a resolution demonstrates a desire to bring clarity and closure to a case that has major implications for the cryptocurrency industry. #Binance.US #SEC